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Wind: NEA Issues 2017 Wind Investment Monitoring and Warning Results
The NEA recently published monitoring and warning results for wind investment in 2017. Most important is the red-listing of six major wind producing provinces, which prevents project approvals for new wind power projects. The affected provinces are: Xinjiang, Gansu, Ningxia, Inner Mongolia, Jilin and Heilongjiang. The NEA document also encourages a greater and concentrated effort for wind investment in the greater Jing-Jin-Tang area, which borders the red-listed provinces. (NEA CN)
Map of Regions where Wind Power Project Approvals Are Halted (Red)
Source: Azure International, NEA
Authorities continue to struggle with high curtailment rates in many provinces due to significant installed capacity, low power demand, or transmission bottlenecks constraints. The red-listed provinces account for over 76 GW, 51% of total wind capacity in China. Individually, the affected provinces all experienced high levels of curtailment in 2016, with Inner Mongolia (21%), Jilin (30%), Heilongjiang (19%), Gansu (43%), Ningxia (13%), and Xinjiang (38%). The intent of the temporary ban on project approvals is to push project development southward. The halt corroborates with the trend to push wind power development away from Northern areas and towards the South.
Wind: 2016 Solar Installation Statistics Published by the CWEA
China Wind Energy Association recently published new wind installation figures for 2016. New installations of wind dropped by 24% to 23 GW, down from 30 GW in 2015. This new installation of wind power brings the total installed capacity to 169 GW. Windy northwest provinces continued to attract the most amount of new capacity additions (26%), followed by the North China (Huabei) region (24%) and East China (Huadong) region (20%). Additionally, total offshore wind power capacity increased by 64%, with over 590 MW of new capacity installed in 2016, bringing the total offshore wind capacity to 1.6 GW. (ESCN)
Source: Azure International, CWEA
High curtailment in windy provinces is clearly making its mark on new installation patterns. While the resource-rich northwestern provinces still saw the largest share of new capacity additions at 26%, this was down from 2015's whopping 38%. In the face of congested transmission lines and high curtailment, developers are choosing to build closer to load centers, as evidenced by the eastern coastal region of Huadong seeing the largest percent increase in new capacity of any region.
Plan: Guiding Opinion on Energy Work for 2017 Published by NEA
According to the NEA's 2017 Guiding Opinion on Energy Work, by the end of 2017 China will install 20 GW of new wind capacity, with another 25 GW under construction. The document also calls for a gradual shift to developing wind in eastern coastal and southern provinces, as well as a short-term stay on building new wind power in provinces that have curtailment rates above 20%. Finally, the document also calls for the acceleration of offshore wind development. (BJX CN)
As made clear both by the CWEA wind statistics and the NEA's guiding opinions, the major story for wind in 2017 is China's increasing emphasis on developing wind generation sources closer to eastern and southern coastal load centers. This emphasis on developing wind proximal to load centers can be seen both in the increasing emphasis on offshore wind generation as well as the targets set out in the 13th Five Year Plan to shift development away from windy northern provinces to the south and east.
Markets: NYSE Issues Noncompliance Notice to Yingli Solar
Yingli Green Energy Holding Company Limited (NYSE: YGE) announced that the company had received notice from the New York Stock Exchange (NYSE) Regulation on February 9th, 2017. The notice stated that the company was below the continued listing standards of the NYSE, specifically that its average market capitalization over a 30 day period was below $50 million. Following the notice, Yingli has 90 days to present a plan to the NYSE demonstrating how it will regain compliance with NYSE's standards within 18 months. The plan will then be evaluated by the NYSE. If accepted, Yingli will be subject to quarterly reviews of its compliance progress. If the plan is not accepted, Yingli Green Energy will be subject to suspension and delisting procedures from the New York Stock Exchange, although the stock may continue trading in over-the-counter (OTC) markets. (PRNewswire)
Yingli modules at a 50 MW Datong solar farm
Source: Yingli Solar
This notice is not the first time Yingli has come into problems with the NYSE's continued listing standards, as the company faced the threat of delisting in November of 2015 as well, when its shares were trading below the $1 threshold for 20 consecutive days. Furthermore, according to Yingli's latest quarterly earnings report, for the third quarter 2016 Yingli suffered an operating loss of $34 million.
Solar: 2016 Solar Installation Statistics Published by the CEC
The CEC recently published statistics on domestic solar installations for 2016. According to the document, by the end of 2016, over 34 GW of new solar energy had been installed across the country, bringing the total installed capacity to over 77 GW. Total power generation from solar in 2016 was 66 TWh, approximately 1% of national power generation. 28% of new installations occurred in the Northwest area comprising Shaanxi (217 GW), Gansu (76 GW), Ningxia (217 GW), Qinghai (119 GW) and Xinjiang (329 GW). (CEC)
Source: Azure International, CEC
As mentioned in last week's News Update, the frenzied growth in solar in 2016 is largely due to utility scale projects rushing to completion before the large tariff cut in June 2016. However under the Electricity Development Plan, the Solar Power target for 2020 further calls for 60 GW of distributed solar and 5 GW of concentrated solar, with the remaining 45 GW is assumed to be standard utility-scale solar. Thus we expect the next three years to see a moderate cooling of utility scale projects in China as local governments digest current project pipelines.
On the other hand, current installation figures indicate distributed solar capacity in China is hovering at around only 10 GW. Therefore while the 2020 target of 110 GW target will likely be surpassed, it will be difficult for distributed solar to reach its sub-target of 60 GW, especially as the regions currently driving solar installation figures (Northwest and IMAR) are almost exclusively installing utility scale projects, with distributed projects concentrated more in highly populated east coast provinces.
Plan: Solar Development Plan of the 13th Five Year Plan “十三五” Published by NEA
In December the NEA published the Solar Power Development Plan, part of China's national 13th Five Year Plan. According to the document, by the end of 2015, total installed solar capacity was 43 GW, and total power generation from solar sources was nearly 40 TWh , approximately 0.7% of national power generation. By 2020, installed solar capacity is targeted to reach 110 GW, with total power generation more than tripling to 150 TWh, 1.6% of national power generation. (NEA CN)
Source: Azure International
While not specified in the Solar Power Development Plan, under the Electricity Development Plan, the Solar Power target for 2020 further calls for 60 GW of distributed solar and 5 GW of concentrated solar, with the remaining 45 GW assumed to be standard utility scale solar.
While the explosive buildout of utility scale solar projects in 2016 puts the current installation numbers at 77 GW at 2016 year end, the majority of this growth has been from utility scale projects rushing to completion before the large tariff cut in June. Currently distributed solar in China is hovering at around only 7 GW. Therefore while the 110 GW target will likely be surpassed, it is unlikely that distributed solar will be able to reach its sub-target of 60 GW.
Plan: Biomass Development Plan of the 13th Five Year Plan “十三五” Published by NEA
The NEA recently published the Wind Power Development Plan, part of China's national 13th Five Year Plan. According to the document, by the end of 2015, total installed wind capacity was 10.3 GW, and total power generation from wind 52 TWh, approximately 0.92% of national power generation. By 2020, installed wind capacity will reach 15 GW, with total power generation nearly doubling to 90 TWh, 1.3% of national power generation. (NEA CN)
Biomass pipeline covering the period of the 13th Five Year Plan
Source: Azure International
During the 13th Five Year Plan, total investment in the Biomass industry will reach 196 billion RMB. Of this 196 billion RMB, 40 billion RMB will go towards power generation, 120 billion RMB for biogas, 18 billion RMB for biomass briquette industries, and 18 billion RMB for investment into liquid biofuels.
Plan: Wind Development Plan of the 13th Five Year Plan “十三五” Published by NEA
The NEA recently published the Wind Power Development Plan of the 13th Five Year Plan. The development plan lays out comprehensive onshore and offshore installation targets per province for 2020. According to the document, by the end of 2015, total installed wind capacity was 129 GW, and total power generation from wind 186.3 TWh, which was 3.3% of national power consumption. By 2020, installed wind capacity will be 210 GW, with total power generation more than doubling to 420 TWh, 6% of national power consumption. The development plan also highlights cross provincial UHV transmission lines under construction or that have recently come online, aimed at delivering power from the north to east and central China. (NEA CN)
Long Distance Cross-Provincial UHV Transmission Lines Highlighted in Wind Power Development Plan
2015 Installed Capacity and 2020 Targets, by province
Source: Azure International, NEA
The wind development plan calls for continued capacity expansion by 2020, however, as seen in the chart above, 64% of new capacity additions, 64 GW, will be in southern provinces with less robust wind resources. This reflects central planners desire to ease high curtailment levels in the “three norths”, 三北, area of the Northwest, Northeast and North China grids. Provinces seeing the largest capacity increase to 2020 are Yunnan (7.9 GW, 191%); Hebei (7.8 GW, 76%); Jiangsu (5.4 GW, 131%); and Henan (5.1 GW, 559%). Provinces that saw the highest levels of curtailment in 2016, such as Gansu (1.48 GW, 12%) Xinjiang (1.09 GW, 6%) and Jilin (0.56 GW, 13%) are targeted for much smaller capacity increases. Offshore wind development is also emphasized, with Fujian set to build 3 GW, or 60% of total offshore wind, by 2020.